The document discusses factors to consider when determining how much life insurance is needed, such as family size and financial obligations. It outlines different types of life insurance policies, including term life and various permanent/cash value policies. The document suggests choosing a policy based on one's needs and goals, such as mortgage protection, family protection, or business needs. It emphasizes periodically reviewing coverage as needs change over time.

1. Bode Financial Group, Ltd
Thomas Bode, CPA/PFS®, CFP®
4061 North Main Street
Suite 250
Racine, WI 53402
262-898-7300
clientservices@bodefinancialgroup.com
http://bodefinancialgroup.com/
Protecting Your Loved Ones
with Life Insurance
How much life insurance do you
need?
Your life insurance needs will depend on a number of
factors, including the size of your family, the nature of
your financial obligations, your career stage, and your
goals. For example, when you're young, you may not
have a great need for life insurance. However, as you
take on more responsibilities and your family grows,
your need for life insurance increases.
Here are some questions that can help you start
thinking about the amount of life insurance you need:
• What immediate financial expenses (e.g., debt
repayment, funeral expenses) would your family
face upon your death?
• How much of your salary is devoted to current
expenses and future needs?
• How long would your dependents need support if
you were to die tomorrow?
• How much money would you want to leave for
special situations upon your death, such as
funding your children's education, gifts to charities,
or an inheritance for your children?
• What other assets or insurance policies do you
have?
Types of life insurance policies
The two basic types of life insurance are term life and
permanent (cash value) life. Term policies provide life
insurance protection for a specific period of time. If
you die during the coverage period, your beneficiary
receives the policy's death benefit. If you live to the
end of the term, the policy simply terminates, unless it
automatically renews for a new period. Term policies
are typically available for periods of 1 to 30 years and
may, in some cases, be renewed until you reach age
95. With guaranteed level term insurance, a popular
type, both the premium and the amount of coverage
remain level for a specific period of time.
Permanent insurance policies offer protection for your
entire life, regardless of your health, provided you pay
the premium to keep the policy in force. As you pay
your premiums, a portion of each payment is placed
in the cash value account. During the early years of
the policy, the cash value contribution is a large
portion of each premium payment. As you get older,
and the true cost of your insurance increases, the
portion of your premium payment devoted to the cash
value decreases. The cash value continues to
grow--tax deferred--as long as the policy is in force.
You can borrow against the cash value, but unpaid
policy loans will reduce the death benefit that your
beneficiary will receive. If you surrender the policy
before you die (i.e., cancel your coverage), you'll be
entitled to receive the cash value, minus any loans
and surrender charges.
Many different types of cash value life insurance are
available, including:
• Whole life: You generally make level (equal)
premium payments for life. The death benefit and
cash value are predetermined and guaranteed
(subject to the claims-paying ability of the issuing
insurance company). Your only action after
purchase of the policy is to pay the fixed premium.
• Universal life: You may pay premiums at any time,
in any amount (subject to certain limits), as long as
the policy expenses and the cost of insurance
coverage are met. The amount of insurance
coverage can be changed, and the cash value will
grow at a declared interest rate, which may vary
over time.
• Index universal life: This is a form of universal life
insurance with excess interest credited to cash
values. But, unlike universal life insurance, the
amount of interest credited is tied to the
performance of an equity index, such as the S&P
500.
• Variable life: As with whole life, you pay a level
premium for life. However, the death benefit and
cash value fluctuate depending on the
performance of investments in what are known as
subaccounts. A subaccount is a pool of investor
Your life insurance needs
will depend on a number
of factors, including
whether you're married,
the size of your family,
the nature of your
financial obligations,
your career stage, and
your goals.
Page 1 of 2, see disclaimer on final page

2. Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2015
IMPORTANT DISCLOSURES
Registered Principal, Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment
Advisor Representative, Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Bode Financial
Group, Ltd. are not affiliated.
Content provided by Broadridge Investor Communication Solutions, Inc. Broadridge Investor Communication Solutions, Inc. does not
provide investment, tax, or legal advice. The information presented here is not specific to any individual's personal circumstances. To the extent
that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding
penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual
circumstances.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed
to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time
and without notice.
funds professionally managed to pursue a
stated investment objective. You select the
subaccounts in which the cash value should be
invested.
• Variable universal life: A combination of
universal and variable life. You may pay
premiums at any time, in any amount (subject
to limits), as long as policy expenses and the
cost of insurance coverage are met. The
amount of insurance coverage can be changed,
and the cash value goes up or down based on
the performance of investments in the
subaccounts.
With so many types of life insurance available,
you're sure to find a policy that meets your needs
and your budget.
Choosing and changing your
beneficiaries
When you purchase life insurance, you must name
a primary beneficiary to receive the proceeds of
your insurance policy. Your beneficiary may be a
person, corporation, or other legal entity. You may
name multiple beneficiaries and specify what
percentage of the net death benefit each is to
receive. If you name your minor child as a
beneficiary, you should also designate an adult as
the child's guardian in your will.
What type of insurance is right for
you?
Before deciding whether to buy term or permanent
life insurance, consider policy cost and potential
savings that may be available. Also keep in mind
that your insurance needs will likely change as
your family, job, health, and financial picture
changes, so you'll want to build some flexibility into
the decision-making process. In any case, here
are some common reasons for buying life
insurance and which type of insurance may best fit
the need.
Mortgage or long-term debt: For most people, their
home is one of their most valuable assets and also
the source of their largest debt. An untimely death
may remove a primary source of income used to
pay the mortgage. Term insurance can replace the
lost income by providing life insurance for the
length of the mortgage. If you die before the
mortgage is paid off, the term life insurance pays
your beneficiary an amount sufficient to pay the
outstanding mortgage balance owed.
Family protection: Your income not only pays for
day-to-day expenses, but also provides a source for
future costs such as college education expenses and
retirement income. Term life insurance of twenty
years or longer can take care of immediate cash
needs as well as provide income for your survivor's
future needs. Another alternative is cash value life
insurance, such as universal life or variable life
insurance. The cash value accumulation of these
policies can be used to fund future income needs for
college or retirement, even if you don't die.
Small business needs: Small business owners need
life insurance to protect their business interest. As a
business owner, you need to consider what happens
to your business should you die unexpectedly. Life
insurance can provide cash needed to buy a
deceased partner's or shareholder's interest from his
or her estate. Life insurance can also be used to
compensate for the unexpected death of a key
employee.
Review your coverage
Once you purchase a life insurance policy, make sure
to periodically review your coverage--over time your
needs will change. An insurance agent or financial
professional can help you with your review.
A note about variable life
and variable universal life
insurance
Variable life and variable
universal life insurance
policies are offered by
prospectus, which you can
obtain from your financial
professional or the
insurance company. The
prospectus contains
detailed information about
investment objectives, risks,
charges, and expenses.
You should read the
prospectus and consider
this information carefully
before purchasing a
variable life or variable
universal life insurance
policy.
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